Annual Report and Financial Statements 2015
Our remuneration policy has been designed in order to promote the long-term success of the company.
The following table provides a summary of how our incentive framework aligns with our business strategy and the results that it delivers:
As part of the development of our business plan for 2015–20, we spoke to more than 30,000 customers across the North West to ask them what they valued most about our service, and what they wanted to see improved. This feedback helped to inform five customer promises, which are at the heart of our strategy for the next five years and beyond.
We have established a set of performance commitments to make sure that we are on track to meet our customer promises. There are 26 performance commitments in total – 18 of which relate to our wholesale business and carry a financial incentive or penalty (known as an ‘outcome delivery incentive’) which were agreed as part of Ofwat’s final determination. Rewards and penalties will be accumulated throughout 2015–20, and applied by Ofwat in the following five-year period from 2020. The size of the reward or penalty is weighted according to the value that customers place on each measure.
A significant proportion of executive directors' pay is performance-linked and deferred: